Russia Challenges Control of Center on Reform, Resources

Russia Challenges Control of Center on Reform, Resources

Article excerpt

RUSSIA is lifting restrictions on foreign trade and is seizing
control of natural resources on its territory, according to decrees
issued by President Boris Yeltsin.

The measures are designed to jump-start the republic's stalling
economy. At the same time, they could further complicate Soviet
President Mikhail Gorbachev's efforts to revive a political union
among the former Soviet republics.

Mr. Yeltsin outlined the long-promised economic liberalization
measures Friday in a speech to the Russian parliament. Under the
decrees, businesses in Russia will no longer require special
registration to engage in foreign trade.

In addition, the decrees allow for the ruble to be converted
into hard currency, such as dollars. All Russian citizens will have
the right to obtain dollars and to open hard-currency accounts in
authorized Soviet banks. The decrees also will allow foreign
companies doing business in Russia to repatriate profits by turning
ruble earnings into hard currency.

The decrees are the clearest indication to date of Russia's
desire to bypass central institutions and become the leader in
carrying out market reforms.

Yeltsin's plan to allow market forces to dictate the rate of
exchange for the ruble is perhaps the most direct challenge to
centralized authority over the economy.

"The ruble's rate against foreign currencies is formed on the
basis of supply and demand," said one decree.

Russia also will take control of the production, storage, and
export of all precious metals and diamonds on its territory,
according to the decrees. A Russian government resolution also
states the republic will limit the export of oil as soon as Dec. 1.
The measure aims to ensure adequate heating supplies in the
republic during what promises to be a winter full of shortages.
Russia produces about 67 percent of the precious metal and diamonds
in the Soviet Union and 90 percent of the nation's oil.

The news that Russia was seizing control of precious metals and
other resources came shortly before publication of a Soviet
parliament deputy's claim no gold reserves remained in the Soviet
state bank, Gosbank. …